What is the concept of invisible handSolutionThe term Invisi

What is the concept of invisible hand

Solution

The term \'Invisible Hand\' was first used by Adam Smith in his book \'The Wealth of Nation\' to describe the social benefit of free market (no government intervention). The unseen market force that helps the demand and supply of a free market to move towards the market equilibrium automatically, is the Invisible Hand.

Adam Smith argued that while taking money making decisions, if individual acts according to their own self interest and freely choose what they want to buy or sell, then self interest of both parties lead to decisions that result in right prices and products in that marketplace. Thus a positive outcome can be achieved with the help of invisible hand of economic self interest and no government intervention is needed.